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Buy versus Build an LLM: A Decision Framework for Governments

Authors: Jiahao Lu, Ziwei Xu, William Tjhi, Junnan Li, Antoine Bosselut, Pang Wei Koh, Mohan Kankanhalli

Published: 2026-02-13

arXiv ID: 2602.13033v1

Added to Library: 2026-02-16 03:01 UTC

Risk & Governance

📄 Abstract

Large Language Models (LLMs) represent a new frontier of digital infrastructure that can support a wide range of public-sector applications, from general purpose citizen services to specialized and sensitive state functions. When expanding AI access, governments face a set of strategic choices over whether to buy existing services, build domestic capabilities, or adopt hybrid approaches across different domains and use cases. These are critical decisions especially when leading model providers are often foreign corporations, and LLM outputs are increasingly treated as trusted inputs to public decision-making and public discourse. In practice, these decisions are not intended to mandate a single approach across all domains; instead, national AI strategies are typically pluralistic, with sovereign, commercial and open-source models coexisting to serve different purposes. Governments may rely on commercial models for non-sensitive or commodity tasks, while pursuing greater control for critical, high-risk or strategically important applications. This paper provides a strategic framework for making this decision by evaluating these options across dimensions including sovereignty, safety, cost, resource capability, cultural fit, and sustainability. Importantly, "building" does not imply that governments must act alone: domestic capabilities may be developed through public research institutions, universities, state-owned enterprises, joint ventures, or broader national ecosystems. By detailing the technical requirements and practical challenges of each pathway, this work aims to serve as a reference for policy-makers to determine whether a buy or build approach best aligns with their specific national needs and societal goals.

🔍 Key Points

  • The paper proposes a structured decision-making framework for governments to evaluate whether to buy or build Large Language Models (LLMs), emphasizing the strategic dimensions such as sovereignty, safety, cost, and cultural fit.
  • It identifies various pathways for acquiring LLMs, including direct purchase of models, building from scratch, and hybrid approaches that combine elements of both strategies, each with distinct advantages and limitations.
  • The authors provide insights from practical experiences in building LLMs in different countries, demonstrating the complexities and trade-offs involved in the decision process, particularly in balancing technical capacity with public policy objectives.
  • A detailed evaluation of the lifecycle of LLM development is presented, highlighting the importance of considering long-term sustainability, operational overhead, and evolving technological landscapes during the acquisition decision.

💡 Why This Paper Matters

This paper offers critical insights and a comprehensive framework for understanding the buy-versus-build dilemma faced by governments in deploying LLMs. As LLMs become integral to modern public services, the structured approach outlined in this paper helps policymakers adopt a nuanced understanding of their strategic options, aligning technological adoption with national interests and societal goals.

🎯 Why It's Interesting for AI Security Researchers

AI security researchers would find this paper relevant as it delves into the governance, privacy, and operational security concerns associated with deploying LLMs. The discussions around sovereignty, data residency, and the risks of vendor lock-in are crucial for understanding the security implications of relying on external AI providers versus developing domestic capabilities.

📚 Read the Full Paper